Just as the world finds itself on the brink of a climate change catastrophe, governments urgently seek ways to reverse the course of unfortunate events before it crosses the point of no return. Thus, following the worldwide cataclysm of Covid-19, societies had enough time to reflect on the inevitable loom of climate emergency, especially in industrially active areas.
China already gave a green light to establish the Green and Low-Carbon Investment Fund initiative while Singapore and the European zone want to become the flagship countries battling the climate change threat. Green investing already grasps the hearts and minds of many mainstream investors – that particularly refers to the asset class known as ESG (the one that follows environmental, social, and governance objectives). Unfortunately, most good and innovative concepts will lead to some form of financial manipulation. The only way forward is decentralizing these aspects to keep green investing manipulation-free.
Seeking ways to deep-dive into the nuts and bolts of green investing, I reached out to Teh Huang Wei, the CEO of ecological crypto project OUDToken.
1. First of all, could you please tell me how something can be considered under the bandwagon of “green” investment?
Any investment that contributes to the environment, may it be renewable energy, net zero CO2 emission, or climate positive projects, or even energy efficiency. That said, being more efficient means less damage instead of contributing, but it’s an evolving process. Humans are extremely good at making things better, as long as we are heading in the right direction. We will eventually get there, I just hope we are fast enough.
We are working with nature, not against it. By building a strong business for companies to invest in nature-based solutions, they can supplement or replace large-scale traditional man-made infrastructure.
2. What are the leading practices in this niche? How can they be instilled among industrial profit-hunters?
There are many green projects on the market, but the majority of them are donation-based. While this is good for the environment, it is not sustainable; when the donations stop, they are unable to keep the project running, which is a major issue. Even though people who want to make the world a better place are sacrificing, which I believe is unjust. People that care about the environment and want to make the world a better place for all living things should be rewarded, which is where OUD comes in. OUD is a cryptocurrency that controls a green project that helps the environment while also earning money for token holders.
3. Which method of environment conservation is considered the safest? How can blockchain add up to its proliferation?
The safest option, in my opinion, is to let nature do what it does best; but, people will need to coexist with it, and with blockchain, we can have greater control and transparency over nature’s well-being, and move quickly when nature requires our attention. Blockchain will help us transform sustainability reporting and assurance, better manage, demonstrate and improve our performance and enable us in better-informed decisions making. Offering up a whole new class of potential investors for sustainability programs, spanning from green infrastructure investment to enabling blended financing or charity donations for underdeveloped countries.
We must recognize that people, in some form or another, have a greedy side. If this greed is causing harm to the planet, we must put a stop to it. However, if this greed is making the planet a better place, we can really benefit from a little greed. I say this because if people can profit from environmental protection, they will continue to do so, and the number of people who do so will grow at a rapid rate.
4. With many talks of blockchain technology underpinning Bitcoin contradicting the fundamental principles of sustainable investing, how can this controversy be flattened out?
We can look at this in 2 aspects, financial sustainability and environmental sustainability.
From a financial standpoint, Bitcoin is by far the biggest player in the cryptocurrency ecosystem, and cryptocurrency is the way of the future. It has a market cap comparable to Berkshire Hathaway, which is close to 600 billion dollars, and with more cryptocurrency products and investments from major financial institutions such as JP Morgan, Grayscale, Ark Invest, and others, it is clear where the cryptocurrency world is headed.
From the perspective of environmental sustainability, the crypto ecosystem is continually developing and was thousands of times more efficient just a few years ago. The efficiency of mining and processing will only increase at a faster rate as the renewable energy sector innovates. Cryptocurrency and blockchain have a bright future ahead of them, and it will only become brighter and efficient.
6. What are the main roadblocks on the way of transforming decentralized currency into a mainstream payment phenomenon?
There are quite a number of challenges: government policy, medium integration, exchange integration, merchant & user acceptance, just to name a few.
El Salvador did a good job taking the lead in accepting Bitcoin as legal tender
7. How important is security when it comes to the projects that are not a part of the traditional financial paradigm? What are the ways to ensure that investors are backed up in case of financial misconduct?
There are numerous scams in our world, which we can’t escape, so whether you invest in crypto or shares, you should perform your due diligence. For OUD, we have a trust firm that has been in existence for over 30 years as the custodian of the bio-assets, in case of any financial wrongdoing.
8. As a non-profit foundation, how can any environmentally sustainable fund manage to generate stable returns and offset the business costs, thus satisfying shareholders?
Firstly, OUD is not a non-profit foundation. The trick to maintain a good balance between environmental protection and sustainable business lies within the valuable Aquilaria trees. We control the harvest just enough to maintain the business and achieve reasonable expansion while protecting the rest of the trees. Because the tree is highly valuable, we don’t need to deforest in order to make money.
9. In your opinion, what does the mission of a successful environmental project look like?
In human history, every process of advancement costs a lot of time, determination, focus, there will be many discouragements, and pull backs. That applies especially to a successful environmental project, because it’s not a product of instant results, only after decades will we be able to see the results.
It takes lots of courage to carry out a vision like this, the mission is to keep earth sustainable, OUD is doing it’s part, but it takes many environmental projects and involvement of more people to keep earth our home. If humans are unable to sustain a planet with so many resources, what makes you think we will be able to make it on any other planet?
10. What is your vision of the future of sustainable investing in decentralized finance?
I foresee more green cryptocurrency will be introduce to the ecosystem in coming years. More innovative projects will be activated by decentralized finance, and when people start to see the positive impact these green cryptocurrencies are bringing to the world, it will start growing exponentially. There will be more products, more investors, more SRI(socially responsible investment) , more sustainable ETF in the decentralized finance sector. I mean most of the world leaders are heading towards a more sustainable world.
One day there will be an oversupply of sustainable investment. When that happens, tech-based sustainable investment’s survival will depend on their technology advancement, Pollution control might become a sunset industry, innovative agriculture will take over traditional agriculture, and environmental protection will become a norm and strictly enforced globally.
The author does not have any vested interest in the projects mentioned above.
The opinions in this article belong to the author alone. Nothing in this article constitutes investment advice. Please conduct your own thorough research before making any investment decisions.
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